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Prices & Quotes - UK Markets - Rolls-Royce Holdings (RR.)

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Share Price:
Down 107.70p
Change Today:
-4.35p
Market Cap:
9,012m
Sector:
Aerospace and Defence

Rolls-Royce to put UltraFan 'on ice' until new plane - report

By Sean Farrell

Date: Monday 04 Jan 2021

LONDON (ShareCast) - (Sharecast News) - Rolls-Royce's boss said the company would put its UltraFan engine programme on hold when testing ends in 2022 as it waits for new aeroplanes to be developed.
Warren East told the Financial Times Rolls-Royce would also postpone signing an industrial partner for the next-generation engine until a new aircraft programme goes ahead.

"We absolutely intend to ... complete the phase we are in at the moment, which is to create and fully test our demonstrator," East told the FT. "At that point we will put the thing on ice. I can't force airframe manufacturers to invent new aeroplanes and if there is no demand for them then there is no demand for engines."

Rolls-Royce shares fell 2.7% to 108.2p at 12:50 GMT.

The FTSE 100 company wants to re-enter the market for narrow-body aircraft after quitting almost a decade ago. It has spent about 500m on the UltraFan demonstrator which aims to be 25% more efficient than Rolls Royce's first Trent engines.

Finding a partner for the UltraFan would help relieve pressure on the group's finances with international air travel almost wiped out by the Covid-19 crisis. The company's cash flow relies on the number of hours its engines fly and in December Rolls-Royce said it was eating up cash quicker than expected.

East said it was too early to strike deals with the sector at a near standstill. "Nobody is going to invent a partnership for a business that isn't there," he said. Speculation about potential partners has concentrated on Pratt & Whitney, which Rolls-Royce worked with before leaving the market, and France's Safran.

The aviation industry is in the greatest crisis in its history with most planes grounded and demand predicted to take many years to recover even after the pandemic abates. Airlines have delayed orders of new aircraft and manufacturers have shelved plans for new models.

"The whole sector has taken a battering from Covid," East said. "It is going to be bruised for several years to come and so I'd anticipate a reasonably significant delay before those new aircraft appear."

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RR. Market Data

Currency UK Pounds
Price 107.70p
Change Today -4.35p
52 Week High 218.19p
52 Week Low 38.98p
Volume 68,888,827
Shares Issued 8,368m
Market Cap 9,012m

Performance Indicators

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What The Brokers Say

Strong Buy 4
Buy 0
Neutral 8
Sell 3
Strong Sell 5
Total 20
neutral
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.

RR. Dividends

  Latest Previous
  Interim Final
Ex-Div 24-Oct-19 25-Apr-19
Paid 03-Jan-20 01-Jul-19
Amount 4.60p 7.10p

Trades for 26-Feb-2021

Time Volume / Share Price
17:03 525,445 @ 109.42p
16:37 30,332 @ 107.70p
16:37 10,000 @ 107.70p
16:37 10,000 @ 107.70p
16:37 10,000 @ 107.70p

RR. Key Personnel

Chair Ian Davis
CEO Warren East
CFO Stephen Daintith